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It seems like the writing is on the soundproof wall : The podcast manna from heaven is over , and this hebdomad ’s tidings is evidence . Spotify laid off17 % of the company — its third round of layoff this year — and set off two extremely acclaim shows , including a winner of the Pulitzer Prize for audio reporting . But as a whole , the podcast industriousness did n’t fail . It ’s just that Spotify took a billion - dollar lilt and whiff , and now podcasters have to navigate the fallout .
“ Spotify has kind of set the term of the quote - unquote ‘ wellness ’ of the podcast industry base on their actions as a tech company , ” said Eric Silver , atomic number 27 - founder and head of creative atMultitude , an autonomous podcast corporate . “ But Spotify ’s pick do n’t have anything to do with me . It ’s just that they keep failing so publicly , and now everyone mean podcasting is dead , which really frustrates me . ”
When foreigner suppose of podcasting , they may imagine mega - viral hits like “ Serial ” or long - standing institutions like “ This American Life . ” But for the long tail of podcast creators — those who make podcasts for a living , but are n’t have multi - million - dollar deal from Amazon , Apple or Spotify — the industriousness is n’t as jeopardize as it seems . And yet , Spotify ’s tail hover so great over the podcasting industry that it ’s impossible for its loser not to reverberate .
In 2021 , a yr that saw venture capital letter flowing like champagne at a Gatsby political party , Spotify CEO Daniel Ektold Forbesthat he want his company to be like the Instagram or TikTok of audio .
“ Everyone underestimates audio . It should be a multi - hundred - billion - dollar industry , ” Ek said at the clock time . “ Audio is ours to win . ”
In the last fistful of year , we watch as Spotify grow too many podcasting companies to count — wimble , The Ringer , Anchor , Parcast , Megaphone — and then romance bighearted names from Joe Rogan , to Alex Cooper , to Prince Harry with eight- and nine - digit deals . The company dump over a billion dollar sign into its efforts to tree podcasting but now has canceled over adozenshowsfrom the studio it spend so many hundreds of million to acquire , like Parcast and Gimlet , which have since beencombinedinto one entity and eliminate .
“ In hindsight , I was too ambitious in investing in the lead of our revenue increase , ” Ek said afterSpotify lay off 600 peoplein January .
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“ Spotify told show squad that their podcasts were being canceled because of lowly numbers , ” said ajoint statementby the Gimlet and Parcast unions , post after a round of golf of layoffs in October 2022 . “ But decisions Spotify leadership made directly impart to these low numbers . ”
Across the whole Lord economy , which includes podcasting , there ’s a growing disconnect between the reality of the industry and the stakeholders that invest in it . Last year , the amount of money empower in creator thriftiness companiesdropped around 68%from the first to third quarter . But this statistic does n’t actually say anything about the viability of creators ’ career . It means , quite literally , that few inauguration are raising money .
This is n’t of necessity a forged affair . During the financial backing boom of 2021 , my inbox was flood with pitch from creator saving startup seek jam about their in style funding rounds . Some of these company were exciting , but many of them confused me — as a creator myself , I could n’t imagine myself or my friends in the industry using many of these products . As SignalFire partner Josh Constinetold meearlier this year , “ Godhead are n’t sophisticated enterprise software buyers , nor do they have software package consolidation teams . ” In other Holy Writ , VCs had thrown money at companies that did n’t actually resolve any problems for creators ’ businesses . So , I was n’t surprised that when food market experimental condition constrain , the company that seemed to only want to capitalise on the Jehovah economy hype were no longer being funded .
“ A media companionship needs to have the destination of attain enough money for it to survive , ” Silver told TechCrunch . This might seem intuitive — sure , a business should endeavor to turn a profit . But that ’s not how the reality of speculation - funded inauguration works . Spotify , for example , has only reported quarterly profits a smattering of fourth dimension , because its business has prioritized continual growth over returns . The company is not at all unique in that way .
“ It ’s critical for companies to ‘ say the market , ’ and right now , the market values efficient growth and doing more with less instead of maximum maturation with well-situated cap , ” Creative Juice founder Sima Gandhitold TechCrunchthis summertime .
This “ maximum growth ” mind-set has poison venture - second digital medium companies like Buzzfeed , whichdescendedfrom a shining wizard to anIPO embarrassment . The “ midway class ” of podcasters ca n’t swear on Spotify , and other media workers ca n’t bank on die sensitive empire likeG / atomic number 8 MediaandViceanymore . Over the last few years , worker - owned media outlets like Defector , Aftermath and 404 Media have begun cropping up , often founded and staffed by journalists who had been repeatedly laid off from mismanaged medium company . Now the podcasting industry is face the same figuring as Spotify ’s losses prove that emergence ca n’t take antecedence over sustainability . Already , podcast studioMaximum Funhas adopted a doer - ownership co - op model , and as podcasters preserve to lose faith in big corporations like Spotify , we ’ll see this trend proceed .
“ Spotify is not all of podcasting , although they pretend as if they are , and make choices as if they ’re the only one in the elbow room , ” Silver enjoin . “ Podcasting is not dead . ”
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